Armenian tax authorities said on Tuesday that the total amount of underreported corporate revenues detected by them has nearly doubled this year.
According to the State Revenue Committee (SRC), businesses investigated or audited by SRC officials had to pay 46.8 billion drams ($98 million) in additional taxes in January-November 2019, up from 24.5 billion drams paid in the year-earlier period.
“This is not the informal economy,” Eduard Hovannisian, a deputy head of the national tax and customs service, told reporters. “This is [additional] tax obligations resulting from financial reports submitted by taxpayers.”
Hovannisian said that payments by large and medium-sized companies accounted for the bulk of the extra tax revenues collected as a result of criminal investigations and audits. He attributed the sharp increase in those revenues to robust economic growth and improved tax administration.
In a separate statement, the SRC also reported a near doubling of lawsuits filed against it by corporate or individual taxpayers in the 11-month period. Armenian courts have already ruled against the government agency in 41 of those 839 cases, according to the statement.
Hovannisian also said that the SRC is now conducting 330 criminal investigations into other instances of tax evasion which it believes cost the state 32 billion drams in revenues. Armenian petrol and liquefied gas stations are suspected of having evaded just over half of these taxes, he added.
Speaking at an April 2019 cabinet meeting in Yerevan, Prime Minister Nikol Pashinian accused fuel retailers of routinely failing to issue cash receipts and thus underreporting their earnings. He ordered the SRC to slap heavy fines on these firms and even jail their owners.
The SRC reported an almost 20 percent year-on-year rise in various taxes and customs duties collected in the first ten months of this year.
The Armenian government’s tax revenues are projected to rise by more than 13 percent, to almost 1.7 trillion drams (US$3.6bn), next year.